<PAGE> 1
As filed with the Securities and Exchange Commission on January 30, 1998
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
REMEC, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
CALIFORNIA 3812 95-3814301
(State or Other Jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Incorporation or organization) Classified Code Number) Identification No.)
</TABLE>
9404 CHESAPEAKE DRIVE, SAN DIEGO, CALIFORNIA 92123, (619) 560-1301
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
RONALD E. RAGLAND, CHAIRMAN AND CHIEF EXECUTIVE OFFICER
9404 CHESAPEAKE DRIVE, SAN DIEGO, CALIFORNIA 92123, (619) 560-1301
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
---------------
COPIES TO:
Victor A. Hebert
Paul H. Greiner
Heller Ehrman White & McAuliffe
601 South Figueroa Street
Los Angeles, California 90017-5758
(213) 689-0200
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
---------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===============================================================================================================================
Proposed maximum Proposed maximum
Title of each class of securities Amount to be aggregate offering aggregate offering Amount of
to be registered registered price per share(1) price(1) registration fee
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share 1,047,482 $24.28125 $25,434,172.31 $7,504
===============================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933 based upon the
average of the high and low prices of the Registrant's Common Stock on
January 26, 1998, as reported on the Nasdaq National Market.
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED JANUARY 30, 1998
PROSPECTUS
1,047,482 Shares
REMEC
Common Stock
--------------------
This Prospectus relates to the public offering, which is not being
underwritten, of up to 1,047,482 shares of Common Stock (the "Shares") of REMEC,
Inc. ("REMEC" or the "Company"), which may be offered from time to time by any
or all of the shareholders of the Company named herein (the "Selling
Shareholders"). The Company will receive no part of the proceeds of such sales.
All of the Shares were originally issued by the Company in connection with the
Company's acquisition of Q-bit Corporation ("Q-bit"), by and through a merger of
a newly formed subsidiary of REMEC ("Acquisition Sub") with and into Q-bit (the
"Q-bit Merger"). The Shares were issued pursuant to an exemption from the
registration requirements of the Securities Act of 1933, as amended (the
"Securities Act"), provided by Section 4(2) thereof. The Shares are being
registered by the Company pursuant to the Agreement and Plan of Reorganization
and Merger dated October 24, 1997 (the "Reorganization Agreement"), by and among
REMEC, Acquisition Sub, Q-bit and the Selling Shareholders and pursuant to the
Registration Rights Agreement dated October 24, 1997 (the "Registration Rights
Agreement") among REMEC and the Selling Shareholders.
The Shares may be offered by the Selling Shareholders from time to time
in one or more transactions in the over-the-counter market at prices prevailing
therein, in negotiated transactions at such prices as may be agreed upon, or in
a combination of such methods of sale. See "Plan of Distribution." The price at
which any of the Shares may be sold, and the commissions, if any, paid in
connection with any such sale, are unknown and may vary from transaction to
transaction. The Company will pay all expenses incident to the offering and sale
of the Shares to the public other than any commissions and discounts of
underwriters, dealers or agents and any transfer taxes. See "Selling
Shareholders" and "Plan of Distribution."
The Company's Common Stock is listed on the Nasdaq National Market under
the symbol "REMC." On January 28, 1998, the last reported sale price of the
Company's Common Stock on the Nasdaq National Market was $26.375 per share.
--------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 3 FOR CERTAIN INFORMATION WHICH
SHOULD BE CAREFULLY CONSIDERED BEFORE PURCHASING SHARES OF COMMON STOCK OFFERED
HEREBY.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS , 1998
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy and information statements and other
information with the Commission. Such reports, proxy and information statements
and other information may be inspected and copied at the public reference
facilities maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, NW, Washington, D.C. 20549, and at the following Regional Offices of the
Commission: New York Regional Office, Seven World Trade Center, Suite 1300, New
York, New York 10048 and Chicago Regional Office, Northwest Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material may be obtained by mail at prescribed rates from the Public Reference
Section of the Commission at Judiciary Plaza, 450 Fifth Street, NW, Washington,
D.C. 20549. The Commission maintains a Web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission. The address of the site is
http://www.sec.gov. The Common Stock of the Company is listed on the Nasdaq
National Market, and such reports, proxy and information statements and other
information concerning the Company may be inspected at the offices of Nasdaq
Operations, 1735 K Street, NW, Washington, D.C. 20006.
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") filed by the Company with the Commission under the
Securities Act. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the shares of Common Stock offered
hereby, reference is hereby made to the Registration Statement. The Registration
Statement may be inspected at the public reference facilities maintained by the
Commission at the addresses set forth in the preceding paragraph. Statements
contained herein concerning any document filed as an exhibit are not necessarily
complete and, in each instance, reference is made to the copy of such document
filed as an exhibit to the Registration Statement. Each such statement is
qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company (File
No. 0-027414) pursuant to the Exchange Act are hereby incorporated by reference
in this Prospectus:
(1) The Company's Annual Report on Form 10-K for the year ended
January 31, 1997 and all amendments thereto on Form 10-K/A;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters
ended May 4, 1997, August 1, 1997 and October 31, 1997; and
(3) The description of the Company's Common Stock contained in its
Registration Statement on Form 8-A, filed with the Commission on
December 13, 1995.
Any statement contained in a document incorporated by reference into
this Prospectus shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document that also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
2
<PAGE> 4
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus has been
delivered, upon written or oral request of such person, a copy of any or all of
the foregoing documents incorporated by reference into this Prospectus (other
than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents). Requests for such documents
should be submitted in writing to Investor Relations, REMEC, Inc., 9404
Chesapeake Drive, San Diego, California 92123, (619) 560-1301.
FORWARD LOOKING STATEMENTS
The statements in this Prospectus and the documents incorporated herein
by reference that relate to future plans, events or performance are
forward-looking statements. The Company's future operations, financial
performance, business and share price may be affected by a number of factors,
including the factors listed below, any of which could cause actual results to
vary materially from anticipated results. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date hereof. The Company undertakes no obligation, other than as required under
the Securities Act or the Exchange Act, to publicly release the result of any
revisions to these forward-looking statements that may be made to reflect events
or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
RISK FACTORS
DEPENDENCE ON COMMERCIAL WIRELESS TELECOMMUNICATIONS MARKET
Until recently, the Company's business has been almost exclusively
focused on the defense market. The Company believes that its future growth
depends on continued success in the commercial wireless telecommunications
market. The Company believes that, while the technologies used in the defense
and commercial industries are very similar, the two industries differ
significantly in terms of the customer base, manufacturing requirements and lead
times, the need to expend substantial resources for research and development
without the assurance of reimbursement or recovery of those costs, and credit
risks with customers. As a result, the Company is subject to risks inherent in
the operation of a new business enterprise, including risks associated with
attracting and servicing a new customer base, manufacturing products in a cost
effective and profitable manner, managing the expansion of a business operation
and attracting and retaining qualified engineering, manufacturing and marketing
personnel with industry experience. For example, the Company believes that
microwave engineers with the skills necessary to develop products for the
wireless telecommunications market currently are in high demand and that the
Company may not be able to attract and retain sufficient engineering expertise.
A number of the commercial markets for the Company's products in the
wireless telecommunications area have only recently begun to develop. Because
these markets are relatively new, it is difficult to predict the rate at which
these markets will grow, if at all. Existing or potential wireless
telecommunications market applications for the Company's products may fail to
develop or may erode for many different reasons, including insufficient growth
to support expensive infrastructure equipment, insufficient consumer demand for
wireless products or services because of pricing or otherwise, or real or
perceived security risks associated with wireless communications. If the markets
for the Company's products in commercial wireless telecommunications fail to
grow, or grow more slowly than anticipated, the Company's business, operating
results and financial condition could be materially adversely affected.
3
<PAGE> 5
DEPENDENCE ON DEFENSE MARKET
A substantial portion of the Company's sales has been to the defense
market. As a result, the Company's sales could be materially adversely impacted
by a decrease in defense spending by the United States government because of
defense spending cuts, general budgetary constraints or otherwise. The United
States defense budget has recently been reduced and may be further reduced.
Fewer available defense industry production programs, coupled with continued
pricing pressure on follow-on orders for programs on which the Company
participates, caused sales of the Company's core defense products -- MFMs and
components for microwave systems -- to decline from $35.3 million in the year
ended January 31, 1994 to $27.5 million for the year ended January 31, 1997. The
Company expects to continue to derive a substantial portion of its revenues from
these business segments and to develop microwave products for defense
applications. Failure of the Company to replace sales attributable to a
significant defense program or contract at the end of that program or contract,
whether due to cancellation, spending cuts, budgetary constraints or otherwise,
could have a material adverse effect upon the Company's business, operating
results and financial condition in subsequent periods. In addition, a large
portion of the Company's expenses are fixed and difficult to reduce, thus
magnifying the material adverse effect of any revenue shortfall. Also, defense
contracts frequently contain provisions that are not standard in private
commercial transactions, such as provisions permitting the cancellation of a
contract if funding for a program is reduced or canceled. For example, the
government terminated a large defense program in December 1992 for which the
Company had been supplying in excess of $4.0 million of products on an annual
basis.
CUSTOMER CONCENTRATION AND EXCLUSIVITY
The Company derives significant revenues from a limited group of
customers, including, P-COM, Inc. ("P-COM"), Digital Microwave Corporation
("DMIC"), STM Wireless, Inc. ("STM"), Northrop Grumman Corporation ("Northrop
Grumman"), Motorola, Inc. ("Motorola"), IT&T Corporation ("IT&T"), The Raytheon
Company ("Raytheon," including revenues from Hughes Aircraft Co. and Texas
Instruments which were acquired by Raytheon in 1997), Lockheed Martin
Corporation ("Lockheed Martin"), TRW Inc. ("TRW"), Alcatel Network Systems
("Alcatel") and Dura Pharmaceuticals, Inc. ("Dura"). As of December 26, 1997,
these customers comprised 77% of total backlog, with STM (13%) and Northrop
Grumman (12%) being the only customers that accounted for more than 10% of
total backlog as of such date. The Company anticipates that it will continue to
sell products to a relatively small group of customers. As a result, any
cancellation, reduction or delay in orders by or shipments by any significant
customer, as a result of manufacturing or supply difficulties or otherwise, or
the inability of any customer to finance its purchases of the Company's
products would materially adversely affect the Company's business, financial
condition and results of operations. The Company has granted some of its
customers exclusivity for certain products and expects that in order to enter
into other significant relationships in the wireless telecommunications
industry, customers will either expressly or implicitly require exclusivity on
components used in their products. In entering into such exclusive
arrangements, the Company may have to forego opportunities to supply products
to competing companies. If the Company enters into exclusive relationships with
customers who prove to be unsuccessful, the Company may be materially adversely
affected and the Company may be unable then to establish relationships with the
industry leaders. There can be no assurance that the Company will be able to
locate, or negotiate acceptable arrangements with, significant customers or
that its current or future arrangements with significant customers will
continue or will be successful.
4
<PAGE> 6
INTEGRATION OF ACQUISITIONS
The Company recently acquired two companies of significant size: C&S
Hybrid, Inc. ("C&S Hybrid"), which was acquired in June 1997, and Q-bit
Corporation ("Q-bit"), which was acquired in October 1997. The anticipated
benefits of the acquisitions of C&S Hybrid and Q-bit will not be achieved unless
these companies are successfully combined with the Company in an efficient and
effective manner. The transition to a combined Company in which C&S Hybrid and
Q-bit are wholly owned subsidiaries of the Company will require substantial
attention from management, which has limited experience in integrating companies
the size of REMEC, C&S Hybrid and Q-bit. In addition, the Company recently
acquired Magnum Microwave Corporation ("Magnum"), Radian Technology, Inc.
("Radian"), Verified Technical Corporation ("Veritek") and Nanowave Technologies
Inc. ("Nanowave"). The collective integration of Magnum, Radian, Veritek and
Nanowave also will require substantial attention from management. The diversion
of management attention and any difficulties encountered in the integration of
Magnum, Radian, Veritek, C&S Hybrid, Q-bit and Nanowave as a group could have an
adverse impact on the business and operating results of the Company. There can
be no assurance that Magnum, Radian, Veritek, C&S Hybrid, Q-bit or Nanowave will
be successfully integrated or that the consolidated operations of REMEC and its
subsidiaries will be profitable. The Company will face similar risks in the
integration of any future acquisitions.
MANAGEMENT OF GROWTH
The growth in size and complexity of the Company's business and
expansion of its product lines and customer base have placed, and are expected
to continue to place, significant demands on the Company's management and
operations. The Company's ability to compete effectively and to manage future
growth will depend on its ability to continue to implement and improve
operational and financial systems on a timely basis. There can be no assurance
that the Company will be able to manage its future growth, and the failure to do
so could have a material adverse effect on the Company's business, financial
condition and operating results.
FLUCTUATIONS IN QUARTERLY RESULTS
The Company's quarterly results have in the past been, and will continue
to be, subject to significant variations due to a number of factors, any one of
which could substantially affect the Company's results of operations for any
particular fiscal quarter. In particular, quarterly results of operations can
vary due to the timing, cancellation or rescheduling of customer orders and
shipments, the pricing and mix of products sold, new product introductions by
the Company, the Company's ability to obtain components and subassemblies from
contract manufacturers and suppliers, and variations in manufacturing
efficiencies. In addition, with the decline in available defense industry
production programs, the Company has placed more reliance on development
contracts as a source of defense revenues, resulting in an increased
susceptibility to fluctuations due to an increase in revenues from fixed price
development contracts as a percentage of total revenues. Development contracts
carry reduced gross margins and are
5
<PAGE> 7
typically for minimal hardware deliveries and sporadic non-hardware revenue
items which results in fluctuating sales and gross margins. Accordingly, the
Company's performance in any one fiscal quarter is not necessarily indicative of
financial trends or future performance.
BACKLOG
The Company's order backlog is subject to fluctuations and is not
necessarily indicative of future sales. There can be no assurance that current
order backlog will necessarily lead to sales in any future period. The Company's
order backlog as of December 26, 1997 was approximately $170,396,000,
approximately 52% of which was attributable to commercial customers and
approximately 48% of which was attributable to defense customers. A substantial
amount of the Company's order backlog can be canceled at any time without
penalty, except, in some cases, the recovery of the Company's actual committed
costs and profit on work performed up to the date of cancellation. Cancellations
of pending purchase orders or termination or reductions of purchase orders in
progress from customers of the Company could have a material adverse effect on
the Company's business, operating results and financial condition.
RISKS OF COST OVERRUNS AND PRODUCT NON-PERFORMANCE; LOSS OF INVESTMENT IN DESIGN
AND ENGINEERING
The Company's customers establish demanding specifications for product
performance, reliability and cost. The Company's contract with P-COM to produce
microwave front ends for point-to-point radios and its contract with STM to
produce C-Band VSAT equipment, and a significant portion of the Company's
defense contracts are firm fixed-price ("FFP") contracts that provide for a
predetermined fixed price for stipulated products, regardless of the costs
incurred. The Company has made pricing commitments to P-COM and STM and to other
customers in anticipation of achieving more cost effective product designs and
introducing more widespread manufacturing automation. A substantial portion of
the P-COM backlog involves the re-design by the Company of a substantial portion
of the point-to-point radio front end. The Company faces the risk of
experiencing cost overruns or order cancellation if it fails to achieve
forecasted product design and manufacturing efficiencies or if products cost
more to produce because of increased cost of materials, components or labor or
otherwise. Manufacture of the Company's products is an extremely complex
process. The Company has in the past experienced cost overruns on FFP contracts.
There can be no assurance that cost overruns or problems with performance or
reliability of Company products will not occur in the future. Any such cost
overruns or performance problems may have a material adverse effect on the
Company's business, operating results and financial condition. In addition, the
Company often makes significant investments in design and engineering of new
products for customers without any commitment by the customer for the future
purchase of such products. Failure to receive initial or follow-on orders may
have a material adverse effect on the Company's operating results.
NECESSITY OF IMPLEMENTING HIGH VOLUME MANUFACTURING
Historically, the volume of the Company's production requirements in the
defense market was not sufficient to justify the widespread implementation of
automated manufacturing processes. Fulfillment of substantial orders in the
wireless telecommunications industry will require a significant increase in the
Company's manufacturing capacity. For example, the Company is introducing more
automated manufacturing processes in order to fulfill its obligations to P-COM,
some of which are specialized processes that must be developed. There can be no
assurance that the Company will be able to implement the desired automated
manufacturing processes on a timely basis or at all or that, if implemented,
such manufacturing processes will be sufficient to fulfill the Company's current
and future production
6
<PAGE> 8
commitments in a cost effective manner or that the Company will obtain a
sufficient amount of high volume orders to absorb the capital costs incurred.
COMPETITION
The markets for the Company's products are extremely competitive and are
characterized by technological change, new product development, product
obsolescence and evolving industry standards. In addition, price competition is
intense and significant price erosion generally occurs over the life of a
product. The Company faces some competition from component manufacturers which
have integration capabilities, but believes that its primary competition is from
the captive manufacturing operations of large wireless telecommunications OEMs
(including all of the major telecommunications equipment providers) and defense
prime contractors which are responsible for a substantial majority of the
present worldwide production of MFMs. The Company's future success is dependent
upon the extent to which these OEMs and defense prime contractors elect to
purchase from outside sources rather than manufacture their own microwave MFMs
and components. The Company's customers and large manufacturers of microwave
transmission equipment could also elect to enter into the non-captive market for
microwave products and compete directly with the Company. Many of the Company's
current and potential competitors have substantially greater technical,
financial, marketing, distribution and other resources than the Company and have
greater name recognition and market acceptance of their products and
technologies. No assurance can be given that the Company's competitors will not
develop new technologies or enhancements to existing products or introduce new
products that will offer superior price or performance features or that new
products or technologies will not render obsolete the products of the Company's
customers. For example, Magnum experienced a $2.3 million reduction in cavity
oscillator shipments in its 1996 fiscal year to Harris-Farinon due to
obsolescence. In addition, innovations such as a wireless telephone system
utilizing satellites instead of terrestrial base stations or a device that
integrates microwave functionality could significantly reduce the potential
market for the Company's products. The Company believes that to remain
competitive in the future it will need to invest significant financial resources
in research and development.
DECLINING AVERAGE SELLING PRICES
Many of the Company's customers are under continuous pressure to reduce
prices and, therefore, the Company expects to continue to experience downward
pricing pressure on its products. The Company's customers frequently negotiate
supply arrangements well in advance of delivery dates, requiring the Company to
commit to price reductions before it is determined that assumed cost reductions
can be achieved. To offset declining average sales prices, the Company believes
that it must achieve manufacturing cost reductions and obtain orders for higher
volume products. If the Company is unable to offset declining average selling
prices, the Company's gross margins will decline, and such decline will have a
material adverse effect on the Company's business, financial condition and
operating results.
ENVIRONMENTAL REGULATIONS AND RISKS
The Company is subject to a variety of local, state and federal
governmental regulations relating to the storage, discharge, handling, emission,
generation, manufacture and disposal of toxic or other hazardous substances used
to manufacture the Company's products. The failure to comply with current or
future regulations could result in the imposition of substantial fines on the
Company, suspension of production, alteration of its manufacturing processes or
cessation of operations.
7
<PAGE> 9
News reports have asserted that power levels associated with hand held
cellular telephones and infrastructure equipment may pose certain health risks.
If it were determined or perceived that electromagnetic waves carried through
wireless telecommunications equipment create a significant health risk, the
market for these products could be materially adversely affected, which could
have a material adverse effect on the Company's business, financial condition
and results of operations. Moreover, if wireless telecommunications systems or
other systems or devices that rely on or incorporate the Company's products are
determined or alleged to create a significant health risk, the Company could be
named as a defendant, and held liable, in product liability lawsuits commenced
by individuals alleging that the Company's products harmed them, which could
have a material adverse effect on the Company's business, financial condition
and results of operations.
GOVERNMENT REGULATIONS
The Company's products are incorporated into wireless telecommunications
systems that are subject to regulation domestically by the Federal
Communications Commission ("FCC") and internationally by other government
agencies. Although the equipment operators and not the Company are responsible
for compliance with such regulations, regulatory changes, including changes in
the allocation of available frequency spectra, could materially adversely affect
the Company's operations by restricting development efforts by the Company's
customers, obsoleting current products or increasing the opportunity for
additional competition. Changes in, or the failure by the Company to manufacture
products in compliance with, applicable domestic and international regulations
could have a material adverse effect on the Company's business, financial
condition and operating results. In addition, the increasing demand for wireless
telecommunications has exerted pressure on regulatory bodies worldwide to adopt
new standards for such products, generally following extensive investigation of
and deliberation over competing technologies. The delays inherent in this
governmental approval process have in the past caused and may in the future
cause the cancellation, postponement or rescheduling of the installation of
communications systems by the Company's customers, which in turn may have a
material adverse effect on the sale of products by the Company to such
customers.
Because of its participation in the defense industry, the Company is
subject to audit from time to time for its compliance with government
regulations by various agencies, including the Defense Contract Audit Agency,
the Defense Investigative Service and the Office of Federal Control Compliance
Programs. These and other governmental agencies may also from time to time
conduct inquiries or investigations that cover a broad range of Company
activity. Responding to any such audits, inquiries or investigations may involve
significant expense and divert management attention. Also, an adverse finding in
any such audit, inquiry or investigation could involve penalties that may have a
material adverse effect on the Company's business, financial condition or
operating results.
DEPENDENCE ON SUPPLIERS AND CONTRACT MANUFACTURERS
The Company relies on contract manufacturers and suppliers, in some
cases sole suppliers or limited groups of suppliers, to provide it with services
and materials necessary for the manufacture of products. Certain ceramic low
drift substrates (supplied by NTK of Japan and Alpha Industries, Inc.), certain
semiconductors (supplied by Alpha Industries, Inc., NEC Corp., M/A-Com, Inc.,
MWT and others) and certain components used in VCO products (supplied by Alpha
Industries, Inc., Lockheed Martin and Micrometrics, Ltd.) used by the Company
are sole source items and would require significant effort, time or design
changes to develop alternate sources. The Company is also dependent on P-COM to
supply it with certain modules necessary for the production of microwave front
ends for point-to-point radios for P-COM. The Company's reliance on contract
manufacturers and on sole suppliers involves several risks,
8
<PAGE> 10
including a potential inability to obtain critical materials or services and
reduced control over production costs, delivery schedules, reliability and
quality of components or assemblies. Any inability to obtain timely deliveries
of acceptable quality, or any other circumstance that would require the Company
to seek alternative contract manufacturers or suppliers, could delay the
Company's ability to deliver products to customers, which in turn would have a
material adverse effect on the Company's business, financial condition and
operating results. In addition, in the event that costs for the Company's
contract manufacturers or suppliers increase, the Company may suffer losses due
to an inability to recover such cost increases under fixed price production
commitments to its customers.
LIMITATION ON PROTECTION OF PROPRIETARY TECHNOLOGY; RISK OF THIRD PARTY CLAIMS
The Company does not presently hold any significant patents applicable
to its products. In order to protect its intellectual property rights, the
Company relies on a combination of trade secret, copyright and trademark laws
and employee and third-party nondisclosure agreements, as well as limiting
access to and distribution of proprietary information. There can be no assurance
that the steps taken by the Company to protect its intellectual property rights
will be adequate to prevent misappropriation of the Company's technology or to
preclude competitors from independently developing such technology. Furthermore,
there can be no assurance that, in the future, third parties will not assert
infringement claims against the Company or with respect to its products for
which the Company has indemnified certain of its customers. Asserting the
Company's rights or defending against third party claims could involve
substantial costs and diversion of resources, thus materially and adversely
affecting the Company's business, financial condition and results of operations.
In the event a third party were successful in a claim that one of the Company's
products infringed its proprietary rights, the Company may have to pay
substantial royalties or damages, remove that product from the marketplace or
expend substantial amounts in order to modify the product so that it no longer
infringes such proprietary rights, any of which could have a material adverse
effect on the Company's business, financial condition and results of operations.
DEPENDENCE ON KEY PERSONNEL
The Company is highly dependent on the continued service of, and on its
ability to attract and retain, qualified engineering, management, manufacturing,
quality assurance, marketing and support personnel. The Company does not
maintain key man life insurance on its key executive officers and, except for
Joseph Lee (Executive Vice President), Tao Chow (Senior Vice President), James
Mongillo (Senior Vice President) and Justin Miller (Vice President), such
personnel do not have employment or non-competition agreements with the Company.
Competition for such personnel is intense, and there can be no assurance that
the Company will be successful in attracting or retaining such personnel. For
example, the Company believes that microwave engineers with the skills necessary
to develop products for the wireless telecommunications market currently are in
high demand and that the Company may not be able to attract and retain
sufficient engineering expertise.
CONTROL BY MANAGEMENT
The Company's executive officers beneficially own a substantial portion
of the outstanding shares of the Common Stock of the Company and comprise five
of the ten members of the Board of Directors. As a result, such persons have the
ability to exercise influence over significant matters regarding the Company.
Such a high level of influence may have a significant effect in delaying,
deferring or preventing a change in control of the Company.
9
<PAGE> 11
VOLATILITY OF STOCK PRICE
The market price of the shares of Common Stock, like the stock prices of
many technology companies, is subject to wide fluctuations in response to such
factors as actual or anticipated operating results, announcements of
technological innovations, new products or new contracts by the Company, its
competitors or their customers, government regulatory action, developments with
respect to wireless telecommunications, general market conditions and other
factors. In addition, the stock market has from time to time experienced
significant price and volume fluctuations that have particularly affected the
market prices for the stocks of technology companies and that have often been
unrelated to the operating performance of particular companies. The market price
of REMEC Common Stock has been volatile and may continue to be highly volatile.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares. All proceeds from the sale of the Shares will be for the account of the
Selling Shareholders, as described below. See "Selling Shareholders" and "Plan
of Distribution" described below.
10
<PAGE> 12
SELLING SHAREHOLDERS
The following table sets forth as of the date of this Prospectus, the
name of each of the Selling Shareholders, the number of shares of Common Stock
that each such Selling Shareholder owns as of such date, the number of shares of
Common Stock owned by each Selling Shareholder that may be offered for sale from
time to time by this Prospectus, and the number of shares of Common Stock to be
held by each such Selling Shareholder assuming the sale of all the Common Stock
offered hereby. Except as indicated, none of the Selling Shareholders has held
any position or office or had a material relationship with the Company or any of
its affiliates within the past three years other than as a result of the
ownership of the Company's Common Stock. The Company may amend or supplement
this Prospectus from time to time to update the disclosure set forth herein.
<TABLE>
<CAPTION>
Number of
Number of Shares to be
Number of Shares to be Owned after
Shares Owned Sold under Completion of
Name Prior to Offering(1) this Prospectus Offering
- ---- -------------------- --------------- -------------
<S> <C> <C> <C>
Gary R. Callaway 84,713 84,713 0
Howard B. Hillman 278,708 278,708 0
Howard B. Hillman, Jr 216,867 216,867 0
Elise Hillman Green 216,867 216,867 0
Tatnall L. Hillman 79,630 79,630 0
The Hansel Byron Mead Revocable 84,713 84,713 0
Living Trust Dated 12/01/94
Irene H. Riebe 85,984 85,984 0
--------- --------- ---------
1,047,482 1,047,482 0
</TABLE>
- ----------
(1) The number and percentage of shares beneficially owned is determined in
accordance with Rule 13d-3 of the Exchange Act, and the information is
not necessarily indicative of beneficial ownership for any other
purpose. Under such rule, beneficial ownership includes any shares as to
which the individual has sole or shared voting power or investment power
and also any shares which the individual has the right to acquire within
60 days of the date of this Prospectus through the exercise of any stock
option or other right. Unless otherwise indicated in the footnotes, each
person has sole voting and investment power (or shares such powers with
his or her spouse) with respect to the Shares shown as beneficially
owned.
11
<PAGE> 13
PLAN OF DISTRIBUTION
The Shares covered by this Prospectus may be offered and sold from time
to time by the Selling Shareholders. The Selling Shareholders will act
independently of the Company in making decisions with respect to the timing,
manner and size of each sale. The Selling Shareholders may sell the Shares being
offered hereby on the Nasdaq National Market, or otherwise, at prices and under
terms then prevailing or at prices related to the then current market price or
at negotiated prices. The Shares may be sold by one or more of the following
means of distribution: (a) a block trade in which the broker-dealer so engaged
will attempt to sell Shares as agent, but may position and resell a portion of
the block as principal to facilitate the transaction; (b) purchases by a
broker-dealer as principal and resale by such broker-dealer for its own account
pursuant to this Prospectus; (c) an over-the-counter distribution in accordance
with the rules of the Nasdaq National Market; (d) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (e)
in privately negotiated transactions. To the extent required, this Prospectus
may be amended and supplemented from time to time to describe a specific plan of
distribution. In connection with distributions of the Shares or otherwise, the
Selling Shareholders may enter into hedging transactions with broker-dealers or
other financial institutions. In connection with such transactions,
broker-dealers or other financial institutions may engage in short sales of the
Company's Common Stock in the course of hedging the positions they assume with
Selling Shareholders. The Selling Shareholders may also sell the Company's
Common Stock short and redeliver the shares to close out such short positions.
The Selling Shareholders may also enter into option or other transactions with
broker-dealers or other financial institutions which require the delivery to
such broker-dealer or other financial institution of Shares offered hereby,
which Shares such broker-dealer or other financial institution may resell
pursuant to this Prospectus (as supplemented or amended to reflect such
transaction). The Selling Shareholders may also pledge Shares to a broker-dealer
or other financial institution, and, upon a default, such broker-dealer or other
financial institution, may effect sales of the pledged Shares pursuant to this
Prospectus (as supplemented or amended to reflect such transaction). In
addition, any Shares that qualify for sale pursuant to Rule 144 may be sold
under Rule 144 rather than pursuant to this Prospectus.
In effecting sales, brokers, dealers or agents engaged by the Selling
Shareholders may arrange for other brokers or dealers to participate. Brokers,
dealers or agents may receive commissions, discounts or concessions from the
Selling Shareholders in amounts to be negotiated prior to the sale. Such brokers
or dealers and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with such
sales, and any such commissions, discounts or concessions may be deemed to be
underwriting discounts or commissions under the Securities Act. The Selling
Shareholders may agree to indemnify, under certain circumstances, brokers or
dealers engaged by them to effect sales of the Shares against certain
liabilities, including liabilities arising under the Securities Act. The Company
will pay all expenses incident to the offering and sale of the Shares to the
public other than any commissions and discounts of underwriters, dealers or
agents and any transfer taxes.
In order to comply with the securities laws of certain states, if
applicable, the Shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
Shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
The Company has advised the Selling Shareholders that the
anti-manipulation rules of Regulation M under the Exchange Act may apply to
sales of Shares in the market and to the activities of the Selling Shareholders
and their affiliates. In addition, the Company will make copies of this
Prospectus available to
12
<PAGE> 14
the Selling Shareholders and has informed them of the need for delivery of
copies of this Prospectus to purchasers at or prior to the time of any sale of
the Shares offered hereby.
At the time a particular offer of Shares is made, if required, a
Prospectus Supplement will be distributed that will set forth the number of
Shares being offered and the terms of the offering, including the name of any
underwriter, dealer or agent, the purchase price paid by any underwriter, any
discount, commission and other item constituting compensation, any discount,
commission or concession allowed or reallowed or paid to any dealer, and the
proposed selling price to the public.
The sale of Shares by the Selling Shareholders is subject to compliance
by the Selling Shareholders with certain contractual restrictions with the
Company. There can be no assurance that the Selling Shareholders will sell all
or any of the Shares.
The Company has agreed to indemnify the Selling Shareholders and any
person controlling a Selling Shareholder against certain liabilities, including
liabilities under the Securities Act. The Selling Shareholders have agreed to
indemnify the Company and certain related persons against certain liabilities,
including liabilities under the Securities Act.
The Company has agreed with the Selling Shareholders to keep the
Registration Statement of which this Prospectus constitutes a part effective for
up to two years following October 24, 1997, the closing date of the Q-bit Merger
(which period may be shortened or extended under certain circumstances). The
Company intends to de-register any of the Shares not sold by the Selling
Shareholders at the end of such two year period; however it is anticipated that
at such time any unsold shares may be freely tradable subject to compliance with
Rule 144 of the Securities Act.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed
upon by Heller Ehrman White & McAuliffe, Los Angeles, California, counsel to the
Company.
EXPERTS
The consolidated financial statements and schedule of REMEC, Inc.
appearing in REMEC, Inc.'s Annual Report (Form 10-K/A) for the year ended
January 31, 1997, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon included therein and incorporated herein by
reference which, as to the years 1997, 1996 and 1995, are based in part on the
report of Ireland San Filippo, LLP, independent auditors, and on the report of
Bray, Beck & Koetter, independent auditors. The consolidated financial
statements referred to above are incorporated herein by reference in reliance
upon such reports given upon the authority of such firms as experts in
accounting and auditing.
13
<PAGE> 15
================================================================================
No dealer, salesperson or other person has been authorized to give any
information or make any representations not contained in this Prospectus in
connection with the offering covered by this Prospectus. If given or made, such
information or representations must not be relied upon as having been authorized
by the Company. This Prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy, the Shares in any jurisdiction where, or to any
person to whom, it is unlawful to make such offer or solicitations. Neither the
delivery of this Prospectus nor any sale made hereunder shall, under any
circumstances, create any implication that there has been no change in the facts
set forth in this Prospectus or in the affairs of the Company since the date
hereof.
----------------------
TABLE OF CONTENTS
PAGE
Available Information ......................................................2
Incorporation of Certain Documents
by Reference ...............................................................2
Forward-Looking Statements .................................................3
Risk Factors ...............................................................3
Use of Proceeds ............................................................9
Selling Shareholders .......................................................9
Plan of Distribution ......................................................11
Legal Matters .............................................................12
Experts ...................................................................12
================================================================================
================================================================================
1,047,482 Shares
REMEC
Common Stock
----------------------
PROSPECTUS
----------------------
_________________, 1998
================================================================================
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Company will pay all expenses incident to the offering and sale to
the public of the shares being registered other than any commissions and
discounts of underwriters, dealers or agents and any transfer taxes. Such
expenses are set forth in the following table. All of the amounts shown are
estimates except the Securities and Exchange Commission ("SEC") registration
fee.
<TABLE>
<S> <C>
SEC registration fee............................ $ 7,504
Legal fees and expenses......................... 5,000
Accounting fees and expenses.................... 1,000
Miscellaneous expenses.......................... 496
Total................................ $14,000
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant has the power to indemnify its officers and directors
against liability for certain acts pursuant to Section 317 of the General
Corporation Law of California. Articles Fifth and Sixth of the Registrant's
Amended and Restated Articles of Incorporation provide as follows:
"Fifth: The liability of directors of this Corporation for
monetary damages shall be eliminated to the fullest extent permissible
under California law."
"Sixth: This Corporation is authorized to provide
indemnification of agents (as defined in Section 317 of the California
Corporations Code) for breach of duty to this Corporation and its
shareholders through bylaw provisions, or through agreements with the
agents, or otherwise, in excess of the indemnification otherwise
permitted by Section 317 of the California Corporations Code, subject to
the limits on such excess indemnification set forth in Section 204 of
the Code."
In addition, Article V of the Registrant's By-laws provides that the
Registrant shall indemnify its directors and executive officers to the fullest
extent not prohibited by California General Corporation Law and provides for the
advancement of expenses upon a receipt of an undertaking to repay such amounts
if the person is determined ultimately not to be entitled to indemnification.
The Registrant has entered into Indemnification Agreements with its
officers and directors.
ITEM 16. EXHIBITS.
5.1 Opinion of Heller Ehrman White & McAuliffe.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Ireland San Filippo, LLP, Independent Public Accountants.
23.3 Consent of Bray, Beck & Koetter, Independent Public Accountants
23.4 Consent of Counsel (included in Exhibit 5.1).
24.1 Power of Attorney (included on page II-4).
II-1
<PAGE> 17
ITEM 17. UNDERTAKINGS.
A. UNDERTAKING PURSUANT TO RULE 415.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3)
Securities Act of 1933 (the "Securities Act");
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective Registration
Statement;
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement; provided,
however, that paragraphs A(l)(i) and A(l)(ii) do not
apply if the Registration Statement is on Form S-3 or
Form S-8, and the information required to be included in
a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 (the "Exchange Act")
that are incorporated by reference in the Registration
Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of this offering.
B. UNDERTAKING REGARDING FILINGS INCORPORATING SUBSEQUENT EXCHANGE
ACT DOCUMENTS BY REFERENCE.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration
II-2
<PAGE> 18
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
C. UNDERTAKING IN RESPECT OF INDEMNIFICATION.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 19
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, REMEC, Inc.
has duly caused this Registration Statement on Form S-3 to be signed on its
behalf by the undersigned, thereunto duly authorized, in San Diego, California
on January 30, 1998.
REMEC, INC.
By: /S/ RONALD E. RAGLAND
-------------------------------------
Ronald E. Ragland
Chairman of the Board and
Chief Executive Officer
POWERS OF ATTORNEY
Each person whose signature appears below constitutes and appoints
Ronald E. Ragland, Errol Ekaireb and Michael McDonald his true and lawful
attorneys-in-fact and agents, each acting alone, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to the Registration Statement, and to sign any registration statement for the
same offering covered by this Registration Statement that is to be effective
upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as
amended, and all post-effective amendments thereto, and to file the same, with
all exhibits thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, each acting alone, or his
or her substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- --------- -------- ----
<S> <C> <C>
/S/ RONALD E. RAGLAND Chairman of the Board and Chief January 30, 1998
- ------------------------------- Executive Officer (Principal
Ronald E. Ragland Executive Officer)
/S/ ERROL EKAIREB President, Chief Operating Officer January 30, 1998
- ------------------------------- and Director
Errol Ekaireb
/S/ JACK A. GILES Executive Vice President, President January 30, 1998
- ------------------------------- of REMEC Microwave Division
Jack A. Giles and Director
</TABLE>
II-4
<PAGE> 20
<TABLE>
<CAPTION>
<S> <C> <C>
/S/ DENNY MORGAN Senior Vice President, Chief January 30, 1998
- ------------------------------- Engineer and Director
Denny Morgan
/S/ JOSEPH T. LEE Executive Vice President and January 30, 1998
- ------------------------------- Director
Joseph T. Lee
/S/ MICHAEL MCDONALD Chief Financial Officer and January 30, 1998
- ------------------------------- Secretary (Principal Financial
Michael McDonald and Accounting Officer)
/S/ ANDRE R. HORN Director January 30, 1998
- -------------------------------
Andre R. Horn
/S/ GARY L. LUICK Director January 30, 1998
- -------------------------------
Gary L. Luick
/S/ JEFFREY M. NASH Director January 30, 1998
- -------------------------------
Jeffrey M. Nash
/S/ THOMAS A. CORCORAN Director January 30, 1998
- -------------------------------
Thomas A. Corcoran
/S/ WILLIAM H. GIBBS Director January 30, 1998
- -------------------------------
William H. Gibbs
</TABLE>
II-5
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Pages
- ----------- ----------- --------------
<S> <C> <C>
5.1 Opinion of Heller Ehrman White & McAuliffe.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Ireland San Filippo, LLP, Independent Public Accountants.
23.3 Consent of Bray, Beck & Koetter, Independent Public Accountants.
23.4 Consent of Counsel (included in Exhibit 5.1).
24.1 Power of Attorney (included on page II-4).
</TABLE>
<PAGE> 1
EXHIBIT 5.1
January 30, 1998
REMEC, Inc.
9404 Chesapeake Drive
San Diego, California 92123
Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel to REMEC, Inc., a California corporation (the
"Company"), in connection with the Registration Statement on Form S-3
contemplated to be filed with the Securities and Exchange Commission on January
30, 1998 (the "Registration Statement"), for the purpose of registering under
the Securities Act of 1933, as amended, 1,047,482 currently issued and
outstanding shares of the Company's Common Stock, $0.01 par value per share (the
"Shares"), that may be sold by certain shareholders (the "Selling Shareholders")
of the Company pursuant to the Registration Statement.
In connection with this opinion, we have assumed the authenticity of all
records, documents and instruments submitted to us as originals, the genuineness
of all signatures, the legal capacity of natural persons and the conformity to
the originals of all records, documents and instruments submitted to us as
copies. We have based our opinion upon our review of the following records,
documents, instruments and certificates:
(a) The Restated Articles of Incorporation of the Company certified
by the Secretary of State of the State of California as of
October 22, 1997, and certified to us by an officer of the
Company as being complete and in full force and effect as of the
date of this opinion;
(b) The Bylaws of the Company certified to us by an officer of the
Company as being complete and in full force and effect as of the
date of this opinion;
(c) A Certificate of the Secretary of the Company: (i) certifying
that copies of all records of proceedings and actions of the
Board of Directors of the Company, including any committee
thereof, relating to the issuance of the Shares and the proposed
resale of the Shares pursuant to the Registration Statement have
been provided to us; and (ii) certifying as to certain factual
matters; and
(d) The Registration Statement.
This opinion is limited to the laws of the State of California, and we
disclaim any opinion as to the laws of any other jurisdiction. We further
disclaim any opinion as to any other statute, rule,
<PAGE> 2
REMEC, Inc.
January 30, 1998
Page 2
regulation, ordinance, order or other promulgation of any other jurisdiction or
any regional or local governmental body or as to any related judicial or
administrative opinion. Our opinion to the effect that all issued and
outstanding Shares are fully paid and nonassessable is based on the
certification obtained from the Company identified in item (c) above to the
effect that the consideration for such Shares recited in the Board of Directors'
resolutions for such Shares has been received.
Our opinion expressed below also assumes that: (i) the Registration
Statement becomes and remains effective during the period when the Shares are
offered and sold; (ii) the capitalization of the Company is as described in the
Registration Statement; and (iii) all applicable securities laws are complied
with in connection with the sale of the Shares by the Selling Shareholders.
Based upon the foregoing and our examination of such questions of law as
we have deemed necessary or appropriate for the purpose of this opinion, it is
our opinion that the currently issued and outstanding Shares covered by the
Registration Statement to be sold by the Selling Shareholders are legally
issued, fully paid and nonassessable.
This opinion is rendered to you in connection with the Registration
Statement and is solely for your benefit. This opinion may not be relied upon by
you for any other purpose, or relied upon by any other person, firm, corporation
or other entity for any purpose, without our prior written consent. We disclaim
any obligation to advise you of any change of law that occurs, or any facts of
which we become aware, after the date of this opinion.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the reference to our firm under the
caption "Legal Matters" in the Registration Statement and any amendments
thereto.
Very truly yours,
/s/ HELLER EHRMAN WHITE & McAULIFFE
<PAGE> 1
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3) and related Prospectus of REMEC, Inc. for
the registration of 1,047,482 shares of its common stock and to the
incorporation by reference therein of our report dated February 24, 1997, except
for the first three paragraphs of Note 2, as to which the dates are October 24,
1997, June 27, 1997, and February 28, 1997, respectively, with respect to the
consolidated financial statements of REMEC, Inc. included in its Annual Report
(Form 10-K/A) for the year ended January 31, 1997 and the related financial
statement schedule included therein, filed with the Securities and Exchange
Commission.
/s/ ERNST & YOUNG LLP
San Diego, California
January 30, 1998
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the reference to
our firm under the caption "Experts" in the Registration Statement (Form S-3)
and related Prospectus of REMEC, Inc. for the registration of 1,047,482 shares
of its common stock and to the incorporation by reference therein of our report,
dated March 6, 1997, on the financial statements of Radian Technology, Inc. as
of December 31, 1996, and for the three years then ended.
/s/ IRELAND SAN FILIPPO, LLP
January 30, 1998
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the reference to
our firm under the caption "Experts" in the Registration Statement (Form S-3)
and related Prospectus of REMEC, Inc. for the registration of 1,047,482 shares
of its common stock and to the incorporation by reference therein of our
report, dated February 28, 1997, on the financial statements of Q-Bit
Corporation as of December 31, 1996 and December 31, 1995, and for the two
years ended December 31, 1996.
/s/ BRAY, BECK & KOETTER
Melbourne, Florida
January 30, 1998
